The European Commission on Cryptocurrencies: Here are their 6 main conclusions.

Thijs Maas is a Dutch LLM student who developed a keen interest in the interplay between distributed ledger technologies and law. He started LawAndBlockchain.eu to help narrow the increasing gap between legal doctrine and regulatory challenges posed by blockchain-based asset classes.

The European Commission held a round-table discussion on the potential, impact and challenges of cryptocurrencies. While it recognizes the opportunities posed by distributed ledger technologies, it also warns about the irrationality and speculation in the secondary market.

Second, crypto-currencies, which are not currencies in the traditional sense, and whose value is not guaranteed, have become subject of considerable speculation. This exposes consumers and investors to substantial risk including the risk to lose their investment.

This is why our third conclusion is that warnings about these risks to consumers and investors are important: these must be clear, frequent, and across all jurisdictions.

Fourth, Initial Coin Offerings have become a way for innovative firms in this field to raise substantial amounts of funding. This is an opportunity, but there are also problems that expose investors to substantial risk, such as the lack of transparency regarding the identity of the issuers and underlying business plans.

Fifth, we need to assess further under what circumstances crypto-currencies and related services are covered by existing regulation. This depends very much on the facts and circumstances around specific crypto-tokens.

Based on the assessment of risks and opportunities and the suitability of the existing regulatory framework for these instruments, the Commission will determine if regulatory action at EU level is required.

Thijs Maas is a Dutch LLM student who developed a keen interest in the interplay between distributed ledger technologies and law. He started LawAndBlockchain.eu to help narrow the increasing gap between legal doctrine and regulatory challenges posed by blockchain-based asset classes.

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